Nexo will be shutting down its operations in the United States.
The London-based crypto lender cited the lack of regulatory clarity as the reason for this move.
The lender’s negotiations with U.S. regulators have failed to yield any results.
Nexo is facing simultaneous enforcement actions from eight different U.S. states.
The lender’s Earn Interest Product will be unavailable in ten US states including California, and Washington.
London-based crypto lender Nexo has announced that it will begin shutting down its operations in the United States. The lender will phase out its products and services from the country over the next few months.
Nexo is leaving due to a lack of regulatory clarity
According to the press release put out by the lender, the lack of regulatory clarity is one of the core reasons that prompted this drastic move. The inconsistent approach from state and federal regulators has only made things worse.
Our decision comes after more than 18 months of good-faith dialogue with US state and federal regulators which has come to a dead end.”
The press release further revealed that in an attempt to please the regulators, Nexo had off-boarded clients from the states of New York and Vermont between 2021 and 2022. Additionally, the crypto lender suspended new registrations for all US clients for our Earn Interest Product. From 6 December onwards, the Earn Interest Product ban will be extended to 8 additional states, namely Indiana, Kentucky, Maryland, Oklahoma, South Carolina, Wisconsin, California, and Washington.
Other efforts to get on the good side of U.S. regulators include registering token sales with the Securities and Exchange Commission (SEC), delisting XRP following the SEC’s lawsuit against Ripple Labs, and exiting the New York and Vermont crypto market at the request of officials.
Despite the above-mentioned efforts undertaken by Nexo, negotiations with U.S. regulators have fallen apart. The lender has indicated that there is a power struggle among regulatory agencies at the state and federal levels which has led to inconsistent decisions. The lack of clarity has also led to legal trouble for the firm as it faces enforcement actions by State regulators from California, Kentucky, New York, Maryland, Oklahoma, South Carolina, Washington, and Vermont. These include cease and desist orders as well as a statement of charges.
Nexo has clarified that arrangements have been made with the company’s payment specialists so that all withdrawals can be processed in real-time.